A high-quality retail enterprise

Alex Mo, the CEO of MINISO South Africa, shares his insights into the South African retail market

Alex Mo, the CEO of MINISO South Africa, shares his insights into the South African retail market and the substantial growth planned for the company

MINISO was established in 2013 and over the past five years, has grown to over 3 200 stores worldwide. Mo says: “We have stores on every continent and we thought it was time to bring MINISO to Africa.”

Mo joined the company in 2016, following a successful career spanning many continents. “I have worked in Ghana and Kenya so I was hired because of my experience in bringing retail to the African continent. The South African market differs substantially from Europe’s. With so many different cultures and identities, South Africa is a unique destination for retail,” says Mo.

In addition, he sees South Africa as a modern country, meaning that there are already international brands available, and supply exceeds demand. This is why a brand such as MINISO is important to the country.

“We offer high-quality products at a reasonable cost, we believe in giving the consumer what they want at normalised prices.

“When I started with the company, I saw it as a career move but now that I am part of this exciting journey, it has become a drive to deliver something new to the South African market and, indeed, the African market. With high-end brands, 80% of the cost is actually purchasing the brand, whilst the remaining 20% is for the actual item. MINISO doesn’t believe that this is ethical. As a company and true citizen of the world, we strive to deliver high-end quality at the price that article is actually worth,” Mo explains.

Through this philosophy, MINISO is aiming to eradicate overcharging consumers. This philosophy is echoed in the fact that they are not just a company wanting to make a profit by overcharging but that they believe in giving back to the customer.

All of the items in MINISO’s 10 product lines are the original design, says Mo,

“Many Chinese companies copy the designs of other brands but at MINISO, we believe that originality is the key to success. We also believe that quality is key. Chinese companies have a bad reputation when it comes to quality and we know that the customer deserves more, so that’s what we give them,” he explains.

Making mistakes

Mo is humble and honest and admits that MINISO has made mistakes in the South African market but instead of making excuses, MINISO is taking them as a learning curve.

“For example, internationally, the retail space is dictated by footfall and we opened a shop in Cresta, Johannesburg, based on that metric. What we didn’t know at the time is that the shop is located near a taxi rank and that is why the footfall was so high. Unfortunately, this footfall hasn’t translated into sales. As a company, we don’t see that as a failure, we now understand that the South African market is unlike any other in the world,” he says.

One of the key learnings was to establish the demographics of the footfall, the target audience for MINISO are people who are middle- to high-income earners. “Our products are meant for people who want to improve their lives and their homes, those who are able to pay higher prices for items yet have the economic experience to know when they are being overcharged. People with lower incomes buy products that are purely practical. Our target audience is the one that buys practical items and with an eye for beauty and quality,” Mo explains.

Lofty but achievable goals

By the year 2020, MINISO’s vision is to be in 100 countries, with 10 000 stores and have a turnover of US$20 billion. These goals seem to be unattainable for a retail business, yet Mo says the company is on target and opened 600 stores last year alone. Mo says that the way to achieve these goals is by being honest with the consumer, “Just because a company tells you what an item should cost, it doesn’t mean that price is correct. We are about bringing people what they need and want at a reduced cost, but not at reduced quality. With a large footfall through our doors together with sales, the indication is that we are moving in the right direction. We have also been getting a steady interest with regards to our franchise opportunity, having 20 prospective franchisee candidates who have gone through the approval process,” he says.

Franchising philosophy

MINISO’s franchising model is different and unique. When an investor decides to open a store, the MINISO group manages and runs the store for them. “The franchisee doesn’t even need to visit the store, we do everything for them. This franchising model is actually a way of investing your money in a company that effectively manages it for you. What also makes us different is that we pay the profit share to the investor on a weekly, as opposed to an annual, basis. This way, the investor knows that their money is being well managed, and we are transparent about every transaction,” Mo explains.

MINISO and South Africa

“We are providing jobs for the people of South Africa and through our growth plan for the country, we are aiming to create many more jobs. Unemployment in South Africa is a huge problem and as an international company, we believe that it is our duty to give back to the nation by partnering with Afrika Tikkun to spread the joy into their ‘school outreach programmes’. We are opening 11 more shops in the next five months and with the goal of opening 200 more stores in two years, this will create jobs, not only in the retail shops, but we need warehouse staff, delivery staff, to name a few,” he says.

Mo’s leadership style

Demonstrating his honesty and humility, he says that he doesn’t want to talk about his leadership style, as there are other leaders who may or may not be doing a better job. He says that he is still learning and the process of learning from one’s mistakes never ends. “Anyone who thinks they are the best leader has forgotten that they need to be humble and open to mistakes. It is the only way to get better and reach your goals,” Mo explains.

According to Mo, MINISO is still a relatively small company but with the philosophy of honesty, giving back to the communities in which they operate, the constant striving for quality and taking the environmental impact of the business into consideration, their goals will be reached.

Bringing a company like MINISO into South Africa was not easy but Mo is adamant that through constant learning and development, they will become a household brand.